How will CFA Institute respond to Goldman Sachs 1MDB scandal?

I have never found Goldman Sachs an attractive organisation. It always seemed to me the ultimate expression of money traders in the temple, elevating the pursuit of riches above all other values.

 

Of course good people work there, and, they always told me in Goldman’s defence that it had a strong culture.

 

I wonder what they are feeling now as the charge sheet lengthens against them in the 1MDB scandal.

 

It is already established that the Goldman partner who got them into a project accused of looting $4.5 billion from Malaysian taxpayers had met with his CEO. So did the CEO ask questions about the ethical basis of this deal?

 

I will also be interested to know if the partners involved turn out to be members of the CFA Institute which is the global professional body for many of those who work in finance and capital markets. In 2004, before the global financial crisis, Tomorrow’s Company published Restoring Trust. I then met with the Global President of CFA Institute. We had suggested a Hippocratic Oath for investment I professionals, an idea later taken up by MBAs. We urged him to take serious steps to hold CFAs accountable for upholding the CFA professional code.

 

The words are all their on the CFA website. So where are the deeds? Why hasn’t behaviour changed? How many CFA members were expelled last year?

 

It is examples like this that sicken and infuriate ordinary citizens and fuel populism. If powerful professional bodies prove powerless to restrain greedy investment bankers, then don’t be surprised if voters lash out.

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